Swiss national Jens Fred Sturzenegger was slapped with the charge of not reporting suspicious transactions and for giving false information to the Singapore authorities. Sturzenegger was arrested by Singapore's Commercial Affairs Department on October 5 following the shutting down of the bank in the country.

Singapore accuses Sturzenegger of helping hide the suspicious transaction involving US$1.265 billion into two Falcon bank accounts in March 2013. Sturzenegger, 42, is also accused of deliberately presenting false information to the Singapore Monetary Authority in a query regarding the ongoing probe.

MAS said the action against Falcon was based on three grounds. It said the bank's head office failed to act on conflicts of interest relating to an account of a customer who was associated with former board chairman Mohamed Ahmed Badawy Al-Husseiny.

It also cited the improper conduct of the Singapore branch manager and a "persistent and severe lack of understanding of MAS' AML requirements and expectations.

The central bank had also imposed fines on DBS and UBS banks for violating its anti-money laundering policies.

Falcon Bank is owned by one of the world's leading sovereign wealth funds, Abu Dhabi's International Petroleum Investment Company (IPIC).

The Malaysian state fund, which is at the centre of the biggest political scandal in the country, is under money laundering investigations in at least six countries including Singapore, US and Switzerland.